Greens claim $2b will fix Newstart poverty

IS $2 BILLION a year too much to help Australia's most impoverished people?

The Greens will this year move to raise the weekly Newstart, Abstudy and Youth Allowance rates for singles by $50 a week, arguing the time for talking about the problem is over.

The Greens senator Rachel Siewert will introduce the plan to the Senate in Parliament's first sitting week in February. She said: ''It's realistic and achievable and, if we're truly a caring society, we care for our most vulnerable.''

The Parliamentary Budget Office says the plan would cost about $7.4 billion between now and 2016-17.

The Greens say a separate plan - as yet uncosted by the Parliamentary Budget Office - to index Newstart, Abstudy and Youth Allowance in the same way as the aged pension, would bring the cost to $8 billion over four years.

Newstart and the other payments are indexed at a lower rate than the pension, leaving those progressively lower than the aged and disability pensions.

The development comes after a week of debate about the adequacy of the dole, to which more than 80,000 single parents - most of them women - were transferred this week from the higher parenting payment.

Business groups, unions and the community sector have been calling for a rise to the $35-a-day dole for months. The Families Minister, Jenny Macklin, caused uproar this week by saying that she could live on the benefit.

Senator Siewert, who spent a week living on the equivalent of the dole last year to highlight the challenges it presents to its recipients, said: ''All the evidence, and my own small taste of the experience, shows that Newstart is too low, evidence the government tragically continues to ignore. ''People can't live on such low support; it forces them into a poverty cycle, which becomes yet another barrier to employment.''

This week the Treasurer, Wayne Swan, and the Health Minister, Tanya Plibersek, said the government's priority was to get people into paid work.

She said: ''I think that anyone would understand that it is hard to live on an income support payment, and that's why as a government we've increased the aged pension, we've increased disability pension [and] we've increased carers support, but Newstart Allowance for unemployment is designed to be a temporary payment''.

But Senator Siewert said about 40 per cent of people who went onto Newstart remained on the payment after a year, with 60 per cent finding work.

While pressure is growing for an increase to the dole, senior government ministers have refused to comment this week about whether a rise is being considered for the May budget.

The Business Council of Australia chief executive, Jennifer Westacott, has written and spoken in support of raising the dole, saying in August that ''entrenching people into poverty by expecting them to live on $35 a day is not a pathway back into employment''.

The Australian Council of Social Services, the Australian Manufacturing Workers Union and the National Welfare Rights Network all called this week for the dole to be increased.

The Greens say the needed money could be found by toughening the mining tax and increasing the mining tax rate to 40 per cent.

How the story unfolded

On Tuesday the Families Minister, Jenny Macklin, sparked an outcry by claiming she could live on the dole of just $35 a day. Her answer was omitted from the transcript of a press conference issued by her office.

The comments came on the day more than 80,000 single parents were moved from the parenting payment to the lower Newstart.

Ms Macklin's office claimed her answer was ''inaudible'' on its recording of the press conference, but refused to hand over their tape.

The acting Greens leader, Adam Bandt, whose Melbourne electorate has the highest proportion of people in public housing in the country, said he would spend a week living on $35 a day next month and called for Ms Macklin to join him.

Official figures show those aged 25 to 34 and 35 to 44 are the two biggest groups to receive the Newstart payments.

Those 55 and over have a higher risk of long-term unemployment.

The Australian Council of Social Services chief executive, Cassandra Goldie, says the changes would leave vulnerable people - the majority of them women - between $60 and $110 a week worse off.